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New Twists in Military Sex Scandal; Petraeus Testimony on Libya Attack; Presidential News Conference; Nancy Pelosi's Future; Jordanians Warn King Over Gas Prices; Working with Wall Street; New Jersey Governor Christie Favors Tax Hike; Marine Creates Ballet about Iraq War; Israel Kills Hamas Military Chief

Aired November 14, 2012 - 09:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


CAROL COSTELLO, CNN ANCHOR: New questions about the Florida socialite whose name keeps popping up in the wrong places. Lawsuits, foreclosures, and an odd 911 call that shoot reporters off her lawn.

(BEGIN VIDEO CLIP)

JILL KELLEY, FLORIDA SOCIALITE: I'm honorary consul general so I have inviolability so, um, they should not be able to cross my property.

(END VIDEO CLIP)

COSTELLO: Jill Kelley, who is she and why does she have such powerful friends?

Anti-virus millionaire John McAfee is on the run from police, hiding in the sand and changing his appearance. Now he's talking about his end game. You'll hear more from him.

Think you're feeling pain at the pump? These Jordanians are warning their king rising gas prices could cost him his throne.

Warning, warning, you may be driving too close to another car. That's something you could hear coming out of your dashboard. We're taking a look at new technology that could save lives on the road.

And good morning to you. I'm Carol Costello. Thank you so much for joining us this morning.

More new details on Jill Kelley, the Tampa socialite linked to a respected Marine Corps general and a widening sex scandal. Each day it seems more and more like a bad reality TV show. We've seen Kelley march in front of the cameras in a different brightly colored dress each day. Now there are reports that her Bay Front mansion is -- she's having trouble. It could go into foreclosure.

We've also learned she and her surgeon husband are awash in debt. The couple has racked up millions of debt and now faces foreclosures and lawsuits. That's far different than appearances.

Consider Jill Kelley's license plate. CNN confirms that she's an honorary consul of South Korea. At least for the time being. She raised some eyebrows and a few chuckles when she tried to evoke some kind of imaginary diplomatic powers in this 911 call to police. She was complaining about the media outside her home.

(BEGIN VIDEO CLIP)

(BEGIN VIDEO CLIP)

KELLEY: You know, I don't know if by any chance -- because I'm an honorary consul general so I have inviolability so I shouldn't -- they should not be able to cross my property. I don't know if you want to get diplomatic protection involved as well, but now, because that's against the law to cross my property because this is not, like, you know, it's inviolable.

UNIDENTIFIED 911 DISPATCHER: All right. No problem. I will let the officers know.

KELLEY: Thank you.

(END VIDEO CLIP)

COSTELLO: Now keep in mind, Jill Kelley had remarkable access to two of the most powerful and most respected men in Washington. She and her husband were longtime friends with General David Petraeus, former head of the CIA. In fact it was Kelley who unintentionally exposed Petraeus' affair and cost him his job as the CIA director. And of course there's the mountain of e-mails and messages she traded with General John Allen. He's the commander of all international troops in Afghanistan and is now the focus of his own investigation.

Tom Fuentes is a CNN contributor and former assistant director of the FBI.

Welcome, Tom.

TOM FUENTES, FORMER FBI ASSISTANT DIRECTOR: Good morning, Carol.

COSTELLO: OK. So Kelley is an honorary consulate to South Korea. Now South Korea says it may fire her if events warrant. This is just getting embarrassing.

FUENTES: Well, I don't know exactly what they're firing her from since that really is a pretty meaningless term in the first place. So if she gets demoted from some position that almost means nothing, so what?

COSTELLO: Well, let -- you know, it's hard to understand all of these terms being bandied about. So honorary consulate means she helps the South Koreans set up parties and stuff? She introduces them to people in the United States? Do you know what exactly an honorary consulate is?

FUENTES: Not exactly. But diplomatic status is conferred by the host country at the request of a country like South Korea, saying this person is going to be working in your country and we would like you to accredit them as a diplomat. That means normally a citizen of South Korea who's going to be assigned and posted in the United States. So the status of diplomatic immunity or diplomatic status, I should say, is pretty strictly controlled between the two governments and not just conferred out there.

So the honorary title of this -- I mean, that's like being a Kentucky colonel. That doesn't mean you can go to Kentucky and start telling the army what to do.

COSTELLO: Right. And the State Department says she's not employed by the State Department. She has no diplomatic powers whatsoever.

FUENTES: Right. Exactly.

COSTELLO: The thing is, though, she's close to these power generals, she's close to the FBI agents. You're FBI. Is this harmless or do you guys get warnings about these kinds of people?

FUENTES: Well, normally it's harmless. But during my 30 years in the FBI, if a friend, neighbor, relative has some issue come up that they think the FBI should be looking at, they'll come to you and say, you know, hey, Tom, help us out. What do you think? And I would either say, what you're talking about is a civil matter, you should consult an attorney, or maybe it's for the local police, you should consult them.

If it's something that actually should be looked at by the FBI, then I would go back to the office and look, you know, to the supervisor of the squad that handles those types of complaints and violations and say, here, this is what I've been told by someone. I'm handing it to you. That person decides to open the case and who gets assigned to the case. Not the person, the friend, the neighbor, the relative FBI agent.

So in this particular case, Kelley contacts a friend of hers, who's an agent in the Tampa office. That agent takes the information into the Tampa office. It goes to the cybersquad and the supervisor of that squad is the one that makes the very initial determination about opening and assigning that case to a particular case agent from his squad.

If the person that brings the message in or brings the complaint in in the first place really has no involvement in the continuing investigation unless they just happen to be on that squad in the first place. But normally it would go to the experts. That squad handles it. And the original complaining agent is out.

COSTELLO: Interesting. Tom Fuentes, thanks so much for joining us. Former assistant director of the FBI.

FUENTES: Thank you, Carol.

COSTELLO: Also new today, General Allen, General John Allen getting a vote of confidence from his boss, Defense Secretary Leon Panetta. He says Allen will remain the commander of the U.S. and Allied Forces in Afghanistan for the moment at least. But Panetta is shelving his nomination to become NATO's Supreme Allied commander.

(BEGIN VIDEO CLIP)

LEON PANETTA, DEFENSE SECRETARY: No one should leap to any conclusions. No one should leap to any conclusions here. General Allen is doing an excellent job at ISAF in leading those forces. He certainly has my continued confidence to lead our forces and to continue the fight. But his nomination has been put on hold as a prudent measure until we determine what the facts are, and we will.

(END VIDEO CLIP)

COSTELLO: Allen could be in the final hours of his role as the nation's top military leader in Afghanistan. The Senate could confirm his successor as early as tomorrow.

Now the intersection of that political scandal and personal tragedy. In just a couple of hours lawmakers begin closed-door hearings on the terrorist attack that killed the U.S. ambassador to Libya and three other Americans. The White House faces withering criticism over how it responded to security concerns before and how it handled the investigation after.

David Petraeus was expected to be a key witness before the sex scandal forced him to resign as CIA director. He recently traveled to Libya, discussed the violence and other issues with the CIA station chief there. Some lawmakers say he still needs to testify.

(BEGIN VIDEO CLIP)

SEN. SUSAN COLLINS (R), MAINE: I will say that I think it's absolutely imperative that General Petraeus come and testify. He was CIA director at the time of the attack. He visited Libya after the attack. He has a great deal of information that we need in order to understand what went wrong, how this attack occurred, why four Americans lost their lives.

(END VIDEO CLIP)

COSTELLO: CNN foreign affairs correspondent Jill Dougherty is at the State Department.

So, Jill, can lawmakers force Petraeus to testify?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: You know, they definitely want him, you can see that. And in fact, Senator Feinstein of California, who is head of the Senate Intelligence committee, wants him, is hoping that he would testify as early as Friday.

He was scheduled to testify this week. In fact, I believe it was Thursday. That's not happening. But, you know, you've got two things. One is they believe that the information that he has, obviously, would be valuable. And, in fact, in some cases they would say crucial. The other thing is there are allegations by some Republicans that the timing of his stepping down and all of his scandal is connected to the investigation. Now that is surmisal on their part. That's allegations. But there certainly is a lot of interest in getting him up there to tell what he knows.

COSTELLO: Jill Dougherty, reporting live for us this morning.

It has been eight months since the president has held a news conference at the White House. As you know, a lot has happened since then. Attacks in Benghazi, his re-election, the fiscal cliff we're getting very close to.

White House correspondent Brianna Keilar joins us now.

I guess we should expect the president to address this sex scandal, too, right?

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: No doubt he's going to be asked about that, Carol. And as you said, it's been actually more than eight months since the president has had really a full-length press conference.

Back in June he had an abbreviated press conference at the G-20 in Cabo San Lucas that revolved mainly around foreign policy. Then in August he had another abbreviated press conference here in the briefing room just taking questions from four reporters. So today we're expecting he'll be asked about this scandal, no doubt, involving the generals, but also the fiscal cliff.

We're expecting that he will, as he has before expressed support for increase in tax rates on the wealthy Americans. White House press secretary Jay Carney yesterday seemed to signal that the question may be how wealthy. The president has said $250,000 or more for a couple. But perhaps it will be more. We'll see if he puts some meat on the bones there.

And also Benghazi. This will be the first press conference since that attack in Egypt that killed a U.S. ambassador and three other Americans. And I wouldn't be surprised as well, Carol, if he gets questions about looming Cabinet appointments.

COSTELLO: I bet he will.

Yes, news conferences used to be a regular occurrence with the president. Any chance that these will happen more frequently?

KEILAR: You know, I don't know. We did see in the campaign that the president preferred to, instead, do interviews with local stations and to use social media because obviously when there's a press conference with the White House Press Corps, and we're all very intensely familiar with his record, it's clear that the White House has felt that the downside of a misstep has far outweighed the benefit that they would get from this.

However, it would be very unusual if President Obama did not have this press conference after an election. This is sort of the norm that a president does this. George W. Bush had one two days after he was re- elected. Clinton, three days after he was elected. Reagan actually had one the morning after he was re-elected -- Carol.

COSTELLO: OK --

KEILAR: Eight days here. Eight days after.

COSTELLO: I know. 1:00 p.m. Eastern, that's when we're -- or 1:30 p.m. Eastern, I should say,

KEILAR: That's right.

COSTELLO: That's when the president starts speaking.

Brianna Keilar, live at the White House. Thanks so much.

Following the president's afternoon news conference he has a corporate meeting. Mr. Obama along with Vice President Joe Biden are hosting a CEO summit. A dozen chief executive officers from some of the nation's top companies. You may not know their names but you probably heard of the companies they lead. Ford, American Express, Procter & Gamble and Wal-Mart, just to name a few.

Obama's relationship has been strained during his first term because of new laws like Wall Street reform and Obamacare.

Computer viruses are the last thing millionaire John McAfee is worried about right now. He is on the run from police and he says if they get him, they'll kill him.

(COMMERCIAL BREAK)

COSTELLO: Fifteen minutes after the hour.

John McAfee, the multimillionaire who founded McAfee Internet securities says he's now in disguise so police in Belize will not recognize him. That's according to his interview with "Wired" magazine.

Investigators want to talk to him about his neighbor who was shot and killed. They have detained three other people for questioning, but McAfee insists he is innocent and fears police will kill him.

(BEGIN AUDIO CLIP)

JOSHUA DAVIS, WIRED.COM: What's the end game at this point?

JOHN MCAFEE, FOUNDED MCAFEE INTERNET SECURITIES: Well, you know, I don't have a clue, sir. I am, you know -- I am unable to move and that's clear. My face is plastered all the police, all the BDF have my photo.

I'm -- you know, it's a small country. I'm a white man with unique features. If I leave this house, I would be identified instantly and nabbed. So for the foreseeable future this is my home.

The end game is obviously, given enough time, they will track me down. I have to eat. I have to have supplies. I'm using a telephone. They will eventually figure out which phone and triangulate it. You know, it's just a matter of time.

In the meantime, I'd like to get out as much information as I can about the wrongs in this country.

(END AUDIO CLIP)

COSTELLO: Police in Belize say McAfee is not a suspect in this murder but they still want to talk to him.

To politics now. A shake-up could be on the way for Democrats in the House of Representatives. In less than an hour, California Congresswoman Nancy Pelosi will announce whether or not she'll run for another term as House minority leader.

Our senior congressional correspondent Dana Bash joins us from Capitol Hill. Any early word, Dana?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, our Deirdre Walsh just made a phone call from downstairs where this meeting is happening and she was told that it looks like Nancy Pelosi is staying in her job.

I'll just give you the back draft here -- that Nancy Pelosi is speaking with her caucus right now as we speak to talk about her future. There has been so much speculation about whether she would go, because she has yet another term in front of her where she is minority leader or whether she would stay and try one more time to get that speaker's gavel back, get the majority back.

Our Deirdre Walsh is hearing from a good Democratic source that she is reporting to her caucus that she is staying in her role as leader.

And talking to Democratic congressman walking into that meeting, I was just down there moments before coming up and talking to you, talking to many Democrats. That is what they said that they hoped would happen, because she certainly has a lot of loyalty in her caucus.

She has led it over the past 10 years. She became Democratic leader in 2002. She's led it for the past 10 years with an iron fist. She has raised tens of millions of dollars to help Democrats get elected. In fact, Carol, she raised $80 million in the last election cycle alone.

So, that is the word we are getting from our intrepid producer Deirdre Walsh --

COSTELLO: OK.

BASH: -- standing outside that meeting.

COSTELLO: OK. Republicans are sad, because they believe Nancy Pelosi is responsible for some of the gridlock in Congress. So, if Nancy Pelosi retains her leadership role, will there be changes? BASH: You know, unclear. Look, I think that certainly Nancy Pelosi is the Democrat that Republicans like to -- love to hate. She has been the -- or maybe the other way to put it is she -- from their perspective politically, she's the gift that keeps on giving. I mean, I don't -- I can't think of another politician who has been used more and more derisively in television ads than Nancy Pelosi. You know, Republicans put her in every ad that they could up next to the Democratic candidate, saying you see what's going to happen if Democrats take control.

Having said that, on the flip side, she is somebody -- look, she -- love her or hate her -- she is a fascinating and very successful pol. She's an old school, old-fashioned pol. And that she is going to be right here standing up right behind at the top of the hour with a whole bunch of Democratic women. And she's going to clearly make the point that she is staying and she is the highest ranking woman and that should not be -- that should not go unnoticed, Carol.

COSTELLO: Dana Bash, reporting live for us from Washington -- thank you.

Would you protest over $4 a gallon gas? Sure, you would. But they're doing more than complaining in Jordan. Some of them could wind up in jail for what they're doing.

(COMMERCIAL BREAK)

COSTELLO: Now is your chance to talk back on one of the big stories of the day. The question for you this morning: what do you make of the general's scandal?

Jill Kelley, who is she? We know who she thinks she is -- an honorary consul who can wield power just like a diplomat. Get a load of this 911 call to Tampa policy where Kelly tried using her supposed diplomatic clout to get the paparazzi off her property.

(BEGIN AUDIO CLIP)

JILL KELLEY, TAMPA SOCIALITE: I don't know if by any chance because I'm an honorary consul general, so I have inviolability. So, they -- I should -- they should not be able to cross my property. I don't know if you want to get diplomatic protection involved as well, but now, because it's against the law to cross my property since this is now like, you know, it's inviolable.

(END AUDIO CLIP)

COSTELLO: Are you thinking what I'm thinking? Salahis, anyone? You know, the couple who showed up at the White House dinner as invited guests before their cover was blown.

Although Jill Kelley does appear to be more adept at wiggling her way into the circles of power. Obviously, friends with the Petraeuses, and now thousands of e-mails between her and General John Allen.

Kelley is not talking about the scandal publicly but -- get this -- she actually is an honorary consul to South Korea, a volunteer job with no official diplomatic policy, something like a glorified social secretary. Now, the South Korean news agency, Yonhap, is reporting that officials there may fire her from her symbolic post.

Still, Kelley remains at the heart of the escalating military scandal. There's no evidence right now she did anything wrong, but even without any official power, she certainly is having a powerful effect.

Talk back question for you today: what do you make of the general's scandal? Facebook.com/CarolCNN, Facebook.com/CarolCNN. Your comments later this hour.

Rising gas prices may be an annoyance here in the United States but in Jordan, it is reason for vocal protests.

(VIDEO CLIP PLAYS)

COSTELLO: If we do that in the United States, that would be very interesting.

Anyway, it's got citizens in Jordan doing something they've never done before. Take a look at that. They're speaking out against their king, an act that could land them in jail.

Zain Verjee has been following the story. She's in London.

So, Zain, are these protests just about the price of gas?

ZAIN VERJEE, CNN INTERNATIONAL ANCHOR/CORRESPONDENT: Well, it's compounding the situation, because what's important about today and these protests is that this is so rare.

Normally, people will criticize kind of the low-level politicians, Carol, but they will not go for the king himself. And they have. They said we want the fall of the regime and criticism like that is directly punishable by getting yourself landed in jail.

What King Abdullah of Jordan has done is basically pursued these social, economic, political reforms. His critics in the opposition say they're just half steps. They're not really that significant.

But what these rising gas prices have done, up by 50 percent, it's compounded people's frustration -- and, as we know, Carol, frustration is a unifying force.

People are upset about corruption. They're upset about a $3 billion budget deficit. Other parts of the Arab Spring in other countries, Jordan used to get a lot of money and subsidies from different countries in the Gulf region, because they've been having problems, Jordan has suffered.

So the people feel they're paying for it and they're saying, well, why should we?

COSTELLO: Well, you know, the United States counts Jordan as an ally. Could this popular uprising affect their relationship? VERJEE: I think it will probably be worrying the folks at the U.S. and at the State Department because of the unpredictable nature of what we've been seeing over the past year or so in the Arab world. Jordan is considered a moderate country. U.S. has good relations with it.

Jordan is really key also to any peace deal with Israel. Jordan has given intelligence assistance over Iraq and cooperates on issues of terrorism with the U.S.

So, you know, if the situation does escalate, it will be dangerous and it really depends on how King Abdullah handles this really delicate situation. And what people are saying is, you know, the 50 percent increase in gas prices -- kill that. We don't want it.

So, they have to reverse it or do something.

COSTELLO: All right. Zain Verjee reporting live for us this morning -- thank you.

President Obama hard at work this week trying to avoid the looming crisis of the fiscal cliff. The mayor of Columbus -- the mayor of Columbus, Ohio, says the road to success is through Wall Street.

Hi, Mayor Coleman. We'll talk to you, next.

(COMMERCIAL BREAK)

COSTELLO: And good morning. I'm Carol Costello. Thank you so much for joining us.

The opening bell at the New York Stock Exchange rang just seconds ago, trading now underway. That includes about 800 million Facebook shares. They are free from lockup.

Alison Kosik is following the action in New York.

So, explain what that means for investors, Alison.

ALISON KOSIK, CNN BUSINESS CORRESPONDENT: OK. So, first of all, what a lock-up essentially is, is when these companies before they go public, they want to kind of hold people back from selling all their shares at once, to try to keep the price of those shares higher.

Now, as far as how Facebook is faring as these lock-ups expire, if you believe in this theory of the economics 101, when you increase the supply of shares going out there on the market, the price usually goes down. And when the other times when these lock-ups for Facebook ended, you saw the shares fall 6 percent and 4 percent.

But, you know, what I'm seeing that theory thrown out the window right now because Facebook shares are up more than 1 percent and then on Monday, you saw shares jumped more than 4 percent.

But over the past three months, you know, Facebook shares have kind of been finding their footing. The share price really seems to have found some balance. It's kind of circling around the $20 mark, but aha-ha, that's no consolation for those who bought it around $38 on IPO day. So, it's bad for you still.

But if you started working for Facebook before it went public and you're an investor, today is payday. There's going to be more of that coming soon as well, Carol.

COSTELLO: I'm still laughing over your aha-ha.

How many were these lockups are there anyway?

KOSIK: OK. So this is a third of five lockups expirations dates. And this one is, by far, the biggest. Lots of shares being released today. There are two more to go. One next month, 140 million shares are going to hit the market and then another 47 million, they're going to be released in May on the one-year anniversary of the IPO.

And you know what? For these investors who got in early and who were employees early, there's usually a big rush for these investors to cash out because they're able to turn their monopoly money into real wealth, into the real thing. They can take their profits and run -- Carol.

COSTELLO: All right. Understood.

Alison Kosik, reporting live from the New York Stock Exchange.

President Obama, he has a corporate meeting this afternoon. The president, along with Vice President Joe Biden, are hosting a CEO summit. Dozen chief executive officers from some of the nation's top companies. You may not know their names but I'm sure you've heard of the companies they lead -- Ford, American Express, Procter & Gamble, and Walmart, just to name a few.

Mr. Obama's relationship with CEOs has been strained during his first term because of new laws like the Wall Street reform and Obamacare.

Meeting with those business leaders, though, is just what the mayor of Columbus, Ohio, says is the recipe to avoiding a fiscal crisis. In an op-ed published in "The New York Daily News", Mayor Michael Coleman writes an open letter to the president. In it he writes, quote, "Despite the success you've had bringing our nation from the edge of a second Great Depression and on to the road to a recovery, your relationship with America's business community has been weak at best, hostile at worst. In order to avoid the looming fiscal disaster, that relationship needs to change," end quote.

Mayor Coleman joins me from Columbus, Ohio.

Good morning, Mr. Mayor.

MAYOR MICHAEL COLEMAN (D), COLUMBUS, OHIO: Good morning, Carol. How are you?

COSTELLO: I'm good. Thank you so much for joining us.

I would suspect that this meeting with the CEOs and White House is music to your ears.

COLEMAN: You know, it's a great idea, bringing the corporate CEOs of America together, to turn from them being hostile to allies to the president. And here is why that works. Yes, go ahead.

COSTELLO: No, no, go ahead. Finish your thought.

COLEMAN: Yes. Here's how that works and here's why that's important, because the truth is this president has been very pro-business. I mean, you think about it. He has been strong in the auto bailout. He saved the financial markets by bailing out Wall Street. He has had fewer regulations than even the prior president.

And his deeds have been different than words in this respect, that maybe it's time to communicate better with the corporate CEOs of America, because the reality is business understands -- I think they understand, as they have in Columbus, Ohio, that you can't cut your way to prosperity.

COSTELLO: I know. I know. But, Mr. Mayor --

COLEMAN: You need a balance approach to run the business.

COSTELLO: Mr. Mayor, I mean, business leaders are concerned about their bottom line. If the president is talking about raising taxes on the wealthiest Americans, of which they are a part, if he's talking about adding more regulations or eliminating tax loopholes for businesses, they kind of don't like that.

COLEMAN: Well, here's the deal. The deal is business leaders understand how they run their own companies. And that they know they can't cut their way to a profitable bottom line. They have to do a combination of things. They have to cut, which the president has to do. He has to make major cuts in the federal budget.

And then, in addition, corporate CEOs understand they have to sometimes raise prices. And they conduct their businesses the same way the president is suggesting that we conduct the business of the United States of America, a combination of cuts, as well as raising revenue. It seems to me that's the logical, rational thing to do.

And my belief is, as they have in the city of Columbus when I need the business community to step up on a tax increase that the public had to vote on, I was very concerned as the business leaders would, in fact, leave the city, take their businesses and relocate somewhere else. They ended up supporting it because they understand that you have to have both. Not one. Not just the other. It's a combination of both.

And it's rational. That's how they have won their businesses and that's what the president is proposing. I think it's a great idea to bring them in the fold.

COSTELLO: You're talking about logical and rational and we're talking about the federal government and Washington and Congress. And a lot of people might say, yes, I worked in Columbus, Ohio. You have a more tight-knit community, but it's not going to work at the federal level because nobody is interested in that.

In fact, Democrats might say, Mayor Coleman, hey, we won the election. We could play hardball with these CEOs. We don't care.

COLEMAN: That's not the way to go. The way to go is bring in those that were hostile and make them your ally. Help to deliver the message.

If it can work in the center of the political universe, which is Columbus, Ohio -- underscore the word Ohio -- it can work in Washington, D.C. And it worked here, it can work there.

And it's a model that has worked in the past. It can work in the future. I'm confident that the president can pull this together.

COSTELLO: Well, I'm sure many people out there hope you're right.

Mayor Coleman from Columbus, Ohio -- thank you so much for joining us this morning.

COLEMAN: Thank you, Carol.

COSTELLO: You're driving fast when the car in front of you suddenly slams on the brakes. We'll show you how technology can help you survive that horrifying scenario.

(COMMERCIAL BREAK)

COSTELLO: The federal government is making a big push for safety technology in cars. Today, the National Transportation Safety Board is releasing its most wanted list of safety improvements. They expected to highlight -- distracted driving, drunk driving and adding recording devices in cars.

Sandra Endo took a look at the technology that could help to solve those problems.

(BEGIN VIDEOTAPE)

SANDRA ENDO, CNN CORRESPONDENT (voice-over): This is what federal safety officials want to avoid.

UNIDENTIFIED FEMALE: Oh, my gosh!

ENDO: And new technology could help. I got behind the wheel at the Insurance Institute for Highway Safety to see how collision avoidance systems work. This car automatically brakes when it comes too close to the car in front.

(on camera): Wow! That is freaky. And it completely braked on its own.

DAVID ZUBY, INSURANCE INSTITUTE FOR HIGHWAY SAFETY: And it prevented a crash.

ENDO (voice-over): The sensors and cameras installed in the vehicle can detect more than just cars. At a faster speed, watch what happens.

ZUBY: And pedestrian walk out in front of you.

ENDO (on camera): Oh, my gosh! I hit him.

ZUBY: You hit him.

ENDO: Oh, no.

ZUBY: But not too hard. He probably just fell over.

At a higher speed we wouldn't avoid the crash. There would be a crash but because of the braking, the crash would be at a lower speed than it would be without the system.

ENDO (voice-over): The National Transportation Safety Board Wednesday added collision avoidance technology to its list of most wanted safety improvements. It wants states to mandate these systems now available in luxury cars in all cars.

DEBORAH HERSMAN, NATIONAL TRANSPORTATION SAFETY BOARD: We know that hundreds of lives can be saved and hundreds of thousands of injuries can be prevented if the technology improves and you can avoid these run off the road, rear end and also the side departure, the lane departure collisions.

ENDO: Other safety systems on the market include blind spot indicators, directional headlights and an alert when a driver drifts out of the lane. The Insurance Institute says the automatic braking system is effective. The lane departure warning system hurts rather than helps, but it's unclear why.

ZUBY: They don't seem in this early data to preventing crashes, which is a disappointment.

ENDO: Transportation safety officials say once the kinks are worked out, the technology could further reduce the number of fatalities, which has been decreasing from year to year despite the increasing number of drivers on the road.

(on camera): Wow. That was scary.

(END VIDEOTAPE)

COSTELLO: Sandra Endo joins us from -- I can't believe you hit that guy, Sandra. Jeez. At least you missed him the second time.

ENDO: Yes. I had to go through different tests and thank you for not pointing out how I was screaming like a scaredy cat. It's pretty embarrassing.

It's quite interesting to see --

COSTELLO: You were screaming.

ENDO: Yes, this technology really works. It automatically brakes and stops the car in its tracks before hitting the thing or object, or pedestrian, the car in front of you. And it's really interesting to see how it works, but it really depends on how fast you're going.

COSTELLO: Well, you know, the other thing is it's great to have that technology in your car but how much will the car cost you?

ENDO: Yes. Right now it's only available on certain cars and it runs about $1,000 as an added option when you buy your car for the safety technology.

But, Carol, transportation officials are hoping that if it's required by law, it will really drive prices down and one day it could be as common as having seat belts or airbags in every car.

COSTELLO: That's awesome. Sandra Endo, reporting live from Washington.

Republicans and Democrats set to face off over the fiscal cliff this weekend. There's actually one top Republican who says he's going to raise taxes. Yes. We'll tell you who, next.

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DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT: I'm Dr. Sanjay Gupta. Beyond these rows of razor wire, believe it or not, green houses and compost bins.

UNIDENTIFIED MALE: I'm free except past behind the tower. I mean, I walk around out here. I have anywhere the gardens are, I can go.

UNIDENTIFIED MALE: I have this duty, this job. You know, it makes it sufferable.

GUPTA: Hardened criminals tending organic gardens, this Sunday on "THE NEXT LIST."

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COSTELLO: Its 47 minutes past the hour, checking our "Top Stories" now. New Jersey residents can expect to pay more in taxes to pay for Hurricane Sandy repairs. Here is what Governor Chris Christie says.

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GOV. CHRIS CHRISTIE (R), NEW JERSEY: There's no magic money tree. But I think that most people in these towns will recognize that if they believe that the money is being spent reasonably and responsibly to rebuild their towns, they'll be happy to do it.

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COSTELLO: State law normally caps property tax increase at two percent, but the law provides exceptions for emergencies like hurricanes. Nancy Pelosi will ask to keep her position as the House Minority Leader according to Democratic sources. CNN's senior congressional correspondent Dana Bash broke that news earlier this hour. Pelosi is expected to make an official announcement in just about ten minutes.

Toyota Motors recalling nearly three million cars worldwide. It's mostly for Prius models with steering problems but some cars have a problem with the hybrid system failing. Cars are being recalled in United States, Europe and Japan. Toyota says owners will be notified by mail next month.

And this morning people watched as the moon blocked out the sun in a stunning total solar eclipse that was only visible from the northeastern coast of Australia and of course, here on CNN. It only lasted about 20 seconds in some places. Total eclipses are pretty darn rare to see in any given region. They happen about once every 375 years. Wow.

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RAMON BACA, FOUNDER, EXIT 12 DANCE COMPANY: I'm Ramon Baca. I'm a U.S. Marine Iraq war veteran. I'm also the artistic director of Exit 12 Dance Company. I started dancing at a smaller studio and that led to transitioning to larger studios.

Make sure your fingers are up --

As a typical American, I took a lot of things for granted. I wanted to see if I could do something totally different than being an artist. I had something to prove to myself. And I also wanted to serve my country. And so I joined the United States Marine Corps.

In 2005, we were called to deployed to Fallujah, Iraq. We got back in '06, six months after my girlfriend sat me down and she said, you're not ok. You're not the same person that I knew before the war. But if you could really do anything in the world, what would you do?

And I had this interesting choreography. I would -- I would start a dance company. It wasn't a primary goal to talk about the military. But it just wasn't me not to put that -- that part of myself into that work.

And then she goes and you pull back.

The whole tie-in is extremely important and -- and it's -- it's allowed us to do community service outreach to veterans.

UNIDENTIFIED FEMALE: Imagine all the sadness and the grief of the hero who isn't true.

BACA: Warrior Writers is a group of military veterans that write about our experiences. We brought together a couple of veterans. They were very skeptical at the beginning as was I, but in the end, they were so emphatic about giving their stuff and seeing how it came together in movement.

UNIDENTIFIED MALE: Your life, after death, a message lives on.

BACA: I get up every morning and I -- again, like when I was in the Marine Corps, know that I'm making a difference in somebody's life.

Nice job yes.

I didn't go to Iraq with 60 Marines that just wanted to go down and -- and level a city. I went with 60 Marines that wanted to improve a city, so why would it stop overseas?

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(COMMERCIAL BREAK)

COSTELLO: Yes, this bit of breaking news just in to CNN. Israel says it has killed the military chief of the Palestinian militant group, Hamas. Now Israel is bracing for expected retaliation. CNN's Sarah Sidner working her sources on this story. She'll join us minutes from now from Jerusalem. We'll keep you posted.

All right, the "Talk Back" question today, what do you make of the generals' scandal?

This from Karen. "What's the old saying? Absolutely power corrupts absolutely. He and many other powerful men believe they'll never get caught. Please."

This from Brian. "If the media would give it a rest, it would barely tarnish the record of an outstanding military officer and a good. Let this be resolved between the general and his family."

This from Mary. "It's absolutely disgusting. Honestly, I hope it's just a load of nonsense, but when it involves people who are in charge of our country's security, well, you can never be too careful."

This from Dorothy. "You couldn't script this stuff. Ian Fleming is turning over in his grave screaming, 'Why didn't I think of that?'"

Keep the conversation going. Facebook.com/carolCNN.

The next hour of CNN NEWSROOM continues after a break.

COSTELLO: Stories we're watching right now in the NEWSROOM.

We're just weeks away from the fiscal cliff and the President is convening a brand new summit. This time, with some of the top American business leaders.

She's the only person not in hiding in a sex scandal that could end the careers of two high-ranking military men. Now, we're learning more about how Jill Kelley is handling everything, including her sudden fame.

Despite the sex scandal, should David Petraeus still testify in front of Congress about Benghazi? One Pennsylvania congressman says absolutely yes.

And success may be fleeting for Donald Trump as the outcry grows louder for Macy's to dump the Donald. Macy's fighting back with humor.

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DONALD TRUMP, REAL ESTATE MOGUL: What's with the get-up Gringo.

UNIDENTIFIED MALE: I'm Santa Claus.

TRUMP: Let me see for myself.

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